Traditional Life Insurance
The balance sheets of most ultra-affluent families are comprised of complex assets with varying levels of liquidity. Additionally, most wealth transfer strategies require time to mature. As a result, market volatility and changing financial circumstances can have a material impact on asset creation and preservation.
Traditional life insurance product portfolios can produce attractive, income-tax-free internal rates of return and provide immediate liquidity to the policy owner at the death of the insured(s). A well-constructed life insurance portfolio can help reduce the volatility of a family’s net worth while providing an important liquidity hedge for asset transfer strategies that take time to mature, and help to prevent the forced sale of assets that might otherwise be required to fund estate tax liabilities at the death of an insured.
Traditional Life Insurance Objectives
Create liquidity at the time estate taxes are due to avoid the forced sale of assets
Hedge other estate planning strategies that require time to be fully realized
Fund specific inheritances to heirs or charitable bequests
Establish a guaranteed, fixed- income investment within a family’s intergenerational asset allocation
Provide wealth preservation for current and future generations
Private Placement Investment Accounts
One of Benson Blackburn’s specialties is in the structuring and administration of Private Placement Variable Annuity (PPVA) and Private Placement Variable Universal Life (PPVUL) Investment Accounts.
PPVA Investment Accounts are utilized to defer taxes on alternative asset class investments and to establish charitable legacies in a tax-efficient manner, while remaining in control of the assets. PPVUL Investment Accounts are utilized to eliminate taxes on alternative asset class investments, and to enhance the after-tax performance of Dynasty Trust assets.
PPVA Investment Account Objectives
Compound deferral of current-period income tax
Enhance charitable legacy planning
Streamline pre-immigration planning
Modernize Inefficient retail Variable annuity portfolios
PPVUL Investment Account Objectives
Eliminate and defer current-period income tax
Create tax efficiencies for Dynasty Trust investment holdings
Enhance intergenerational Asset transfer planning
Private Placement Life Insurance is an unregistered securities product and is not subject to the same regulatory requirements as registered variable products. As such, Private Placement Life Insurance (or Annuities) should only be presented to accredited investors or qualified purchasers as described by the Securities Act of 1933. This material should not be construed as legal or tax advice and is not intended to replace the advice of a qualified attorney or tax advisor.
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